What is a Multi-pool?
A multipool is a mining platform that allows you to selectively mine cryptocurrencies based on highest profitability in real time. The interface is not currency specific like traditional CPU and GPU miners but rather, a user can move from currency to currency to ensure the maximum efficiency of your mining rig, even if it’s just your laptop.
The main difference between a multi-pool and other mining pools lies in the ease of access. The process of setting up your computer to mine and connecting to a pool is not exactly the easiest thing for intermediate technology users. In order to switch between one currency to another would require tracking all relevant data and then reconfiguring the mining interface manually each time. Mining pools are like auto-pilot for this process.
A platform such as MinerGate, among a few others, will make the whole process simple and can even test your setup to determine the best currency to mine. Of course, you are free to switch between them manually as well, giving you total control over what to mine and when.
What factors determine profitability?
There are a few factors that go into the profitability of mining any given cryptocurrency. The three most influential are coins network mining power, block difficulty and exchange rates. The exchange rate can vary depending on the base currency used for conversion.
In order to constantly determine the best coin to mine, a multipool will calculate its total hash power and find currencies with lower network mining power in order to maximize the chances of solving the next block. These are narrowed further by determining the reward per block for each coin. Finally, exchange rates are considered and the most profitable currency is selected then mined automatically. With MinerGate’s UI, this is called “smart mining”.
More about difficulty levels
One feature built into cryptocurrency mining is a self-adjusting difficulty. In this context, the difficulty is referring to how much hash power is required to solve a block. This feature has been around since Bitcoin and has been implemented in many new ways with varying parameters since.
In the beginning, block difficulty was set so that each block would take a consistent amount of time to solve by adjusting after a set number of blocks. This created a situation where multi-pools were able to increase the network hashing power, take a majority percentage of a mining pool and decrease the block time until the difficulty readjustment takes place. This was great for the people mining on multi-pools but not for the currencies themselves. Most coins would be mined and immediately dumped on the market in order to trade for one particular coin, typically Bitcoin BTC. In turn, the coins being mined and dumped take hits in value. That all changed with the introduction of the Kimoto Gravity Well, or KGW, which works by adjusting the difficulty when the network hash rate increases significantly.
An even newer adjustment method called DigiShield took things a step further by self-adjusting difficulty in real time by mirroring the increase or decrease in network hash at all times. This move could have potentially hurt the profitability of mining pools, but don’t worry – it’s only been implemented in two coins: Digibyte and Dogecoin.
Why MinerGate is a great multi-pool
As stated earlier, most people will mine small amounts of various coins and then sell them for Bitcoin. This simplifies things for the miner but lowers the value of the coin being sold which is bad for investors and users of that coins and its network. However, with MinerGate, it is easy to hold onto all of the various currencies due to the secure online wallets provided when you sign up. It’s highly recommended that you hold as many as you can to both add value to each and diversify your holdings at the same time. By holding many different currencies you reduce the risk involved if one coin were to fail.
Besides that, MinerGate has simplified and streamlined the entire process. The dashboard offers user-friendly ways to exchange currency with Changelly, withdraw to the wallet address of your choice or transfer to a Freewallet address for no charge.
Whether it is supporting the mining of two currencies at once with merged mining or figuring out ways to implement proof-of-capacity mining into the platform, MinerGate is ahead in innovation and user satisfaction. The team is always looking ahead and their enthusiasm and passion for cryptocurrencies shine through.